Shares of Citrix (NASDAQ: CTXS) soared yesterday after the networking software company said it acquired the project management startup Wrike for $2.25 billion and reported better-than-expected Q4 earnings.
Fundamental analysis: Portfolio expanded
Wrike is acquired from the private equity firm Vista Equity Partners for $2.25 billion in cash, Citrix said. The startup is focused on offering project management solutions and it has witnessed a huge surge in demand for its services amid the pandemic.
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“Together, Citrix and Wrike will deliver the solutions needed to power a cloud-delivered digital workspace experience that enables teams to securely access the resources and tools they need to collaborate and get work done in the most efficient and effective way possible across any channel, device or location,” said David Henshall, the President and CEO of Citrix.
According to the official statement, the project management startup reported $140 million in annual recurring revenue (ARR) last year. For this year, Wrike expects its revenue to grow about 30% to a region of $180 million to $190 million.
“When it comes to the future of work, Citrix and Wrike share a common vision and mission: to reduce the complexity and chaos of work and empower every person, team, and organization to achieve their very best. Together, we will unlock the workspace of the future, truly transforming the work experience and equipping people with an innovative set of solutions they can use to exceed goals and keep business moving forward,” said Andrew Filev, Founder and CEO, Wrike.
On another note, Citrix reported earnings per share (EPS) of $1.46 to beat the market estimate of $1.33. Revenue came in at $809.65 million, again higher than the expected $781.34 million. As for its first fiscal quarter, Citrix said it expects EPS of between $1.40 and $1.45.
Technical analysis: Shares gain
Citrix stock price soared over 2.5% yesterday to print the highest levels recorded since October last year. Shares are now on the way to record the third consecutive month in the green, after soaring 9.4% and 5.0% in November and December, respectively.
Technically, the price action is now in the breakout territory as it trades above the key short-term resistance at $134.80. The next target on the upside is the descending trend line at $143.00, but buyers must make sure that the 200-DMA at $137.50 is cleared first.
Citrix reported higher-than-expected results for its fourth quarter. In addition, the digital workspace company acquired the project management startup Wrike for $2.25 billion in cash.